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BCS Financial: Leading a Dynamic Cultural Evolution from Within
- 1. Volume 6, Issue 1, 2011
casestudy
BCS Financial: Leading a Dynamic Cultural Evolution from Within
In 2008, BCS Financial Corporation seemed to As Beacham joined the organization in 2008,
be on top of their game. Built on 60 years of healthcare reform was on the brink of becoming
success, they’ve enjoyed underwriting profits for the a reality and the landscape in which they were
past 20 years and an A.M. Best Rating of “Excellent.” operating was about to change dramatically.
They seemed to have a solid foundation, so why BCS is owned by all Blue Cross and Blue Shield
change? “Why change?” asks Scott Beacham, primary licensee companies. Collectively, these
President and CEO of BCS Financial, “Because companies are both BCS’ governing body and their
our business sector is changing. As a multi-line clients. Therefore, as Blue Cross and Blue Shield
insurance company licensed to do business across organizations change, so must BCS. The leaders at
the United States, we’re operating in one of the most BCS recognized early in their evolution that they had
dynamic industries, in one of the most dynamic times to change. And change they did!
in history.”
Overall Comparison
The Critical Success Factors at BCS Financial Led to Sweeping Culture Change
2009 2010
2009 2010
External Focus External Focus
90
72
90
27 49
27 39
20 94
74 64
16 Beliefs and Beliefs and
Flexible Assumptions Stable Flexible Assumptions Stable
21 24
74 70
19
23 31
34 71
77
67 61
Internal Focus Internal Focus
N = 80 N = 93
When BCS first received their 2010 Culture Results, they thought there must be some mistake. How
could they have improved so dramatically? Then they began to talk about all the things they had done
over the past year, and recognized that they had many reasons to celebrate.
BCS Insurance
SB 2009 28-Jun-10
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- 2. This is the story of BCS and the five critical employee by name, engages them in conversation,
success factors that made their change possible: and regularly asks them, “How are we doing?”
Leadership, Core Values, Quality of Process, Actions He encourages everyone in leadership roles to do
Leading Plans, and Organic Ownership. Their story the same. Beacham admits that it is hard to hear
is focused on strong leadership from above and feedback at times, but the leadership of BCS has
empowerment from below. In the words of the never wavered in their energy or their commitment;
people of BCS, “Whose story is it? Our story.” he makes sure of that.
Critical Success Factor #1: Leadership Best Practices in Leadership
“You can’t wish change; you have to make it Barbara Osterman, President of Human Solutions,
happen,” states Beacham. “It’s about the hearts LLC, is a partner with BCS and offered coaching
of the people who have to make the change. Very and feedback to the organization as part of their
smart people can come up with business strategy, process. She offers some best practice advice in
but it’s through a truly dedicated team of people that this first Leadership Chapter. “One of the important
you create positive change from within.” things that BCS did was to shift focus from ‘getting
work done,’ to creating an environment for people to
BCS had a rock-solid platform. However, it was just do great work. It’s a subtle shift, but very different.
that: a platform, a plateau with a proven record. Second, senior leaders were whole-heartedly
They needed to progress. In order to find the committed to this process. If the people in the
growth they were looking for, they needed to bring organization see any wavering at the top, that’s an
together their strategic platform with their culture indication or an excuse for them to maintain the
transformation process. The success of the past status quo.” Barb Osterman
60 years didn’t make any difference in the vastly
changing healthcare world. It was time to evolve. Critical Success Factor #2: Core Values
BCS leaders committed themselves to blending Mike Kichka is the Director of System Integration
their strategic and culture goals for the good of their and the leader of the Culture Team at BCS. In his
organization and its people. words, “This initiative is all about our ‘heart’ and
strengthening our core values. We are confident that
Beacham often says, “If you have their heart, I with the right people with the right attitude, we will
guarantee you’ll have their mind.” As a leader, be successful in changing our culture.”
Beacham is very concerned about engaging the
hearts of his people. “Engaging people is going To begin their Dynamic Evolution, BCS created
out and having the courage to ask them, ‘How five work groups called the Spheres of Influence:
are we doing?’” Beacham takes his daily “walks Growth, Service, Finance, Communication, and
around the block” as he calls them. He knows each Creativity. The Spheres are made up of cross-
Spheres of Influence
With the creation of the Spheres: Growth, Service, Finance, Communication,
and Creativity, and the Culture Team, BCS created cross-functional teams
E C
R Communication U
U L
T
T
that were accountable to the strategic goals of the company. They were
U
L
R
U
E
C
Growth Service Finance
expected to create goals and objectives to drive profitability and performance
within the organization. This gave employees a line of sight not only to their
own functional departmental goals but also to the organization’s goals,
E
C
R
U
U
L
T
increasing communication, creativity and teamwork within BCS.
T
L U
Creativity
U R
C E
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- 3. Key Positive Forces: Core Values
BCS FINANCIAL CORPORATION 2 011
When BCS started creating their Key Positive
Forces or their core values, they started with 36
BCS Key Positive Forces
Building a Strong and Positive Culture with an Extra Degree of Effort … Everyday!
words that meant something to them. Through CARDINAL VALUE
Trust
many meetings and conversations, they pared
them down to these 12 key words. Each of Perseverance Attitude
these words has a specific meaning; they are
more than just words on a plaque on the wall. Focus Belief
The employees of BCS define what each of CARDINAL VALUE CARDINAL VALUE
these values means to them specifically. If you Reputation Integrity
walk through their halls and ask any employee
what “Perseverance” or “Belief” means they
Teamwork Commitment
will give a consistent answer. Almost every
workspace in BCS has some form of the Key Leadership Responsibility
Positive Forces, whether it is a poster such as CARDINAL VALUE
Respect
this one or the compass. Their values are as
important to them as their strategic plan, their E V E R Y D A Y
profit margin or their sales projections. O U R S TAT E OF B E I N G O U R STATE OF DO ING
functional groups of employees. Each Sphere’s Additionally, BCS developed 12 values called Key
mission is to create strategic and tactical Positive Forces (KPFs) serving as guiding principles
imperatives to drive profitability and performance, for business operations. “These KPFs are the
improve vertical and horizontal communication, and cornerstones of the initiative and vital to improving our
enhance enterprise-wide teamwork and creative ability to manage our day-to-day operations,” says
thinking. Shortly after creating the Spheres, BCS Kichka. “The most crucial aspects of this initiative are
established a Culture Team with its own strategic the attitude and belief that we can change, and the
and tactical imperatives. The Culture Team’s commitment and perseverance to make it happen.
mission is to motivate and inspire employees and Scott clearly communicated that all of these efforts are
bring meaning to BCS’ core values. The volunteer- important. However, the employees will know BCS has
based Culture Team started with four members and changed when they experience the change on a
has since grown to 12. daily basis.”
One of the mantras you’ll hear and see walking Best Practices in Core Values
around the BCS office is “212 Everyday,” which “Core values are about a state of being, an aspirational
started with the Simple Truths book 212°: the state. The first thing to do is to define your core
extra degree by Sam Parker and Mac Anderson. values. Not in a senior executive meeting, but in your
The idea is that at 211 degrees, water is hot. organization. When we look at BCS’ 12 core values,
At 212 degrees, it boils. Boiling water produces we each have a different idea of what those mean.
steam. And steam is powerful enough to move Groups within BCS developed statements to go along
locomotives. By applying an extra degree of effort, with each of their core values so that people within
amazing things can happen. Hence, BCS’ “212 the organization know what it means to demonstrate
Everyday” initiative was born to motivate employees “respect” and live it. BCS found a way to support
and elevate the passion within the workplace. They these in everything that they do.” Barb Osterman
branded the initiative, developed a logo and theme
to identify the initiative, reinforced the message,
and supported its long-term objective.
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- 4. Critical Success Factor #3: Quality of Process
Greg Petit is the Manager of Marketing Services at
Letting Quality of Process Take the Lead
BCS. Petit has been with the organization for 20 Financial
years and witnessed the amazing transformation
C E L E B R A T I N G O U R I N N O VA T I V E I D E A S A N D A C T I O N S D E C E M B E R | 2 010
Insurance Company
at BCS firsthand. Petit, along with many others
who have been with the company for over 20 Creativity | Think as Innovators | A Mindset Critical to Producing Effective Customer and Business Solutions
years, established his roots while the company
If a single idea is like a spark, a shared idea is like a spark in a combustion chamber … the combustion chamber
of our collective experience. The resulting power is explosive and capable of changing the world. How lucky we are to
work at BCS where every idea is valued and respected! As 2010 draws to a close, the Creativity Sphere is thrilled to
introduce our first issue of Aha! We hope this publication inspires you with its wide range of ideas leading to innovation
in business products, practices or processes. Whether you recognize yourself in the spark of the Aha! moment or the
turbulent energy of the combustion chamber, you are an integral component of our Dynamic Evolution. Creativity is
was structured in a very traditional hierarchical
the life-blood of our organization. Creativity celebrates possibility. Every idea tells a compelling story of a company
alive with creative passion. | Our company. Our ideas. Our future.
Federal Home Loan Inspiration: Noticed an unmet need for a low-cost line of credit, realizing that the same solution used
management style, one that was successful for 60
Bank Membership by the banking industry from prior work experience, could be applied to our insurance industry.
Idea from/idea coordinated by: Joe Castellon
Idea: Become a member of Federal Home Loan Bank to facilitate low-cost borrowings. Alternative to
commercial line of credit. Dramatically reduces interest cost associated with borrowings. Protects
balance sheet by maintaining investments that would otherwise have to be sold. Supportive of
The Leadership Path to 2 014.
years. “Many of us grew up in an environment of
Creative input: Joe Castellon
Results: Approved at 2-17-10 BCS Board meeting. Currently being utilized by Finance Department
to accommodate short-term cash needs in BCSI & PLIC.
Inter-Departmental Inspiration: Cyber Risk implementation planning assignment coupled with historical inefficiencies
‘this is not how we’ve done this before.’ We went
New Business Checklist/ in the new business process.
Implementation Plan Idea from/idea coordinated by: Yvonne Lee
Idea: An inter-departmental tracking mechanism to follow and manage the processing of new
sold business, keeping the entire process proactive, on track and on time.
Creative input: Sharon Dold, Chad Chaffin, Chuck Burke, Tracey Crenshaw, Terry Harris-Jones,
Mike Kichka, Rich Behrens, Lou Georgopoulos, Diane Sowell
from quietly minding our own business to something
Results: Checklist for each new piece of business will remain ‘active’ until the newly sold ‘live’
business is fully implemented. Ongoing diary of all activities, documents and lessons learned
is being kept for future creative application. Business no longer handled on a ‘surprise’ basis.
Activities related to implementation no longer fall through the cracks. Cross-departmental
communication throughout the entire process makes for smoother implementation and
better customer service to our client.
radically different,” comments Petit.
By trusting and engaging in the quality of process
Leadership began collaborating with employees they were undertaking, instead of focusing on
for the first time: respecting their ideas and giving the outcome, the employees of BCS embraced
them the room to innovate. This was very new for their empowerment. They were able to create a
BCS employees. The walls became permeable and decision tree that ultimately led to 15 product,
employees were allowed to lead in the process. practice, and procedural innovations that saved
Petit recalls some backroom discussions during the organization both time and money.
this time: “Do you think these Sphere groups are
going to last much longer?” Soon they saw that
the new way of doing things was there to stay not only because their people realized that their
because it was integral to the corporate vision, ideas were valuable, but also because it encouraged
mission, and the balanced scorecard. “We also them to make their ideas operational as quickly as
saw that the Spheres were being staffed by cross- possible. At the end of 2010, the Creativity Sphere
departmental representatives and found ourselves published their first Aha! report featuring 15 ideas
working together and listening to each other, and leading to creativity in products, practices, and
we were actually enjoying the process.” The people procedures; this translates to saving valuable time
at BCS were engaged and accountable for their and money for the organization.
actions in new ways. “It was very different from the
old structure of isolation and staying out of trouble,” Best Practices in Quality of Process
recalls Petit. “We had a brand new attitude. Now, it “The key in quality of process is to invite employees
was about trying to add value and provide excellent into the challenges that you face and then to trust
service for each other.” them. You hear the word ‘organic’ a lot in the
hallways of BCS. At first, the employees of BCS were
Quality of process became the key to everything. waiting for this to go away. Leadership had to make it
Employees had to trust the quality of the process real for them and engaging them in the process was
because the learning that was occurring was more the way to do it. They couldn’t sacrifice the quality of
important than a preconceived outcome. Petit process because they had a date for an outcome.
also heads up the Creativity Sphere. This group Much of what we had planned in the strategic
challenged itself to develop a decision tree. On the planning process didn’t happen when it was
surface, a decision tree sounds very business-like. planned; it happened when it was ready to emerge.
But as they worked through the process, their goal It didn’t mean that we let those goals go, but we
became clear: “We came up with an idea notation asked people to learn while they were working. This
process providing all employees an analysis tool was new for them and learning only happens when
guiding them to implement their ideas autonomously they are engaged and allow those conversations to
if possible or collaboratively if necessary.” This was take place.” Barb Osterman
a turning point for the group and for the organization
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- 5. Critical Success Factor #4: couldn’t have answered those two questions, I can’t
Actions Leading to Plans imagine how we could have achieved what we did
in the first year and what I whole-heartedly believe
In the past, BCS made their strategic plans we’ll achieve for years to come.”
primarily in their functional groups: marketing,
financial, and information technology, etc. With the
creation of the Spheres: Growth, Service, Finance, Best Practices in Actions Leading Plans
Communication, and Creativity, along with the “At BCS, this is where the employees started to
Culture Team, they were able to create cross- understand that the work they were doing in the
functional teams to think in a broader context of the Sphere Teams was intersecting with the strategic
organization. Jim Drew, Assistant Vice President plans. Action plans are about execution and
of Communication, comments, “As a community, accountability. To be successful, they need to
we were able to shift our thinking so that we come from the people who are doing them, the
didn’t just have functional goals in mind, but also people who know best what needs to be done,
the corporate goals represented by our Spheres. so you are able to hold those people accountable.
This allowed us to recalibrate how we worked as The BCS scorecard focuses on Growth, Service,
a group and realign into cross-functional teams and Finance, which you would see on almost any
to create our strategic map framework.” Through business scorecard, but also Communication and
that process, they created their strategic map, Creativity. In this way, BCS weaved together the
containing both strategic and cultural goals. This business and the cultural outcomes to achieve
one page document took about a year to produce. business results.” Barb Osterman
Content wise, it is not long but very well thought out
by the entire organization. Everyone, leaders and Critical Success Factor #5: Organic Ownership
employees alike, now buy into it. Throughout their Dynamic Evolution, employee
empowerment was a critical component. The
In many ways, BCS’ actions lead their plans. employees owned the process. Many organizations
Because they had gone through this process of faced with issues of empowerment wonder where
reflection, they were able to transition their strategic to start and how to give their employees the
framework into the organization’s first balanced empowerment for which they are looking. Trust is
scorecard. The scorecard became a natural part always a critical factor in issues of engagement.
of the organization on the strategic side. On the
cultural side, BCS had taken their first Denison Cindy Jenkins, Senior Accountant and member
Organizational Culture Survey in 2009, about six of the Culture Team at BCS, talks about how
months into their transformation process. They Beacham empowered employees, “The employees
renamed the Denison Organizational Culture Survey of BCS became empowered the day that Scott
the BCS Pulse because it measures the heart of the asked us one simple but courageous question,
organization. ‘How are we doing?’ He wanted honest results on
the Pulse, whether it was good, bad, or ugly. This
Based on the Pulse results, the Culture Team gave us an opportunity to have a voice and made
developed a 50-page analysis document, including us feel like our opinion mattered. After we received
survey results and focus group feedback. Feedback the results, Scott challenged us with another
was collected through a series of safe harbor question, ‘How can we do it better?’”
discussions, lunch and learns, and other sessions
specifically designed so that people could feel free Along with empowerment came accountability
to collaborate, share their feelings, and discuss the for actions. In his own leadership role, Beacham
results in a very transparent manner. Drew states, stressed that the cultural change was owned by the
“Going through this process, I think one of the employees, giving them the chance to be leaders.
biggest successes we achieved was being able to As a result, employees were empowered and
answer two critical questions very effectively: Whose encouraged to take ownership and be accountable
plan is this? Ours. Who created it? We did. If we for what they did. On an individual level, the action
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- 6. and operational plans that were derived from the Best Practices in Organic Ownership
BCS Pulse results and their balanced scorecard “People have run through all five of these success
were incorporated into employees’ personal work factors: engaging them, allowing them to make a
goals. This helped to show employees how they difference, hearing their voices, their ideas, and
fit into the bigger picture, reinforcing their values, truly listening to what they have to add to the
their “212 Everyday,” and the fact that they can business process. It’s about leaders creating the
make a difference in their organization. environment for people to excel. Many companies
say their people are their greatest asset; BCS
Teamwork and communication were also lives it.” Barb Osterman
enhanced through the Sphere Teams. Because
the teams consisted of employees from different
departments, it gave each team a broader lens to Whose Plan? Our Plan!
look through when implementing the operational
The BCS cultural transformation was organically
plan. This also created a forum that has opened
achieved through a quality of process, rooted in
up communication across departments.
core values, that empowered leaders from within
Employees better understood the upstream and
to actively create the organization’s strategic plan.
downstream effects of their actions and found
Beacham has been highlighted over and over
ways to streamline their processes and help
again by his employees as a great leader, but if
each other. Many Spheres have sought feedback
you ask him, he gives credit to the BCS team.
outside of the team to get ideas and provide
Beacham says, “If you walk through the hallways
feedback. This stimulated creativity, promoted
of BCS and ask any of the employees, ‘Whose
the exchange of ideas, and provided a healthier
plan is this?’ They’ll say: ‘It’s our plan.’ ‘Who
atmosphere for teamwork.
has to execute this plan?’ ‘We do!’ The sense of
pride that our people have in this will allow us to
Finally, recognition has been a key factor to
continue to perform now and into the future.”
sustain momentum. Recognition has taken many
inspirational and motivational forms including
posters, awards, or simply saying thank you and
sharing in team accomplishments and milestones.
Related Resources
Denison Consulting. (2005). ResearchNote: Denison Consulting. (2010). ResearchNote:
Overview of the Denison Model. Ann Arbor, MI: Balanced Profile, Better Organizations: Learning
Author to Balance. Ann Arbor, MI: Author
Denison Consulting. (2009). CaseStudy: Sutter Parker, Sam & Anderson, Mac. (2006) 212° the
Connect: Cultivating Culture at the Start. Ann extra degree. Aurora, IL: Simple Truths; www.
Arbor, MI: Author simpletruths.com
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